Simplified IRR Calculator
Use this free Simplified IRR calculator to make better property management decisions. Enter your values below to get instant results.
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How to Use This Calculator
- 1 Enter initial investment
- 2 Enter annual cash flows
- 3 Enter holding period
- 4 Enter sale proceeds
- 5 Calculate simplified IRR
Example Calculation
5-year hold: $80K down, $6K/yr CF, $120K sale equity
Inputs:
- Investment: $80K
- Annual CF: $6K
- Years: 5
- Sale: $120K
Result:
Total: $70K return. Annualized IRR: ~13.4%
Important Considerations
- • IRR misleading for short holds
- • Multiple IRRs possible with irregular cash flows
- • High IRR with low dollars may not be worthwhile
Frequently Asked Questions
Internal Rate of Return measures total annualized return including cash flow, appreciation, loan paydown. Higher = better. Target 12-20%+.
ROI is total return ignoring time. IRR annualizes and accounts for timing. Enables comparison across different holds.
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